The yuan’s the new dollar as Russia rides to the redback

By | November 29, 2022

Reuters reports:

Chinese entrepreneur Wang Min is delighted about Russia’s embrace of the yuan. His LED lights company can price contracts to Russian customers in yuan rather than dollars or euros, and they can pay him in yuan. It’s “win-win”, he says.

Wang’s plans have been transformed by the conflict in Ukraine and the subsequent Western sanctions on Moscow that have shut Russia’s banks and many of its companies out of the dollar and euro payment systems.

His contract manufacturing business with Russia has been small in the past, but now he’s preparing to invest in warehousing there.

“We hope that next year sales in Russia can account for 10-15% of our total sales,” said the businessman from China’s southern coastal province of Guangdong, whose annual revenue of about $20 million mainly comes from Africa and South America.

Wang is seeking to capitalise on a rapid “yuanisation” of Russia’s economy this year as the isolated country seeks financial security from Asian powerhouse China. He sees a win-win situation in Chinese exporters reducing their currency risks and payment becoming more convenient for Russian buyers. [Continue reading…]

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